Transactions
Taylor Dynamometer
Developing competing and back-up buyers for the serious seller …
“I knew when Polaris decided to sell Taylor that we wanted Mertz on our team. Mertz has an excellent reputation for quality work and good judgment. They lived up to every expectation I had.”
– Dean Treptow, Chairman of Polaris Capital Corporation
“I looked at many companies and worked with many investment bankers before buying Taylor. Hands down, Mertz prepares the best offering materials, and they addressed key issues up front. Had it not been for Mertz and their approach, I would not have been as motivated to purchase Taylor.”
– Art Downey, President of GRAM Investments
“I've worked with Mertz on several transactions and frequently refer clients to them. Their work on Taylor was on par with their usual high standards. I know I can rely on Mertz for excellent judgment, even during the more difficult times.”
– John Dickens, Godfrey and Kahn
“I have worked with Mertz on both sides of the transaction. I greatly enjoy working with Mertz because I know they have integrity. Mertz is a rare find, and I look forward to when I can work with them again.”;
– Larry Burnett, Reinhart, Boerner Van Deuren, Norris & Rieselbach, s.c.
Situation
Polaris Capital, an SBIC that invested in small companies, planned to liquidate its portfolio, which included Taylor Dynamometer.
Taylor manufactures and develops engine and truck testing equipment and related proprietary diagnostics software and instrumentation. Founded in 1929, it has a long, successful heritage and unquestionable brand recognition. Under Polaris management, Taylor steadily increased both sales and profits.
Polaris wanted to obtain the best all-cash price possible to provide for both attractive returns and distributions to its shareholders during its liquidation. Ideally, the buyer would also buy the building, which Polaris owned.
Scope of Mertz’s role
Mertz advised Polaris in preparing offering materials, designing a marketing program, developing a customized database, contacting potential purchasers, evaluating proposals and participating in negotiations with the purchaser.
Because Taylor had revitalized itself, Mertz and management carefully prepared an offering document that detailed both what had been and what could be done. Taylor had excellent momentum and a three-phase plan for growth in the heavy-duty diesel niche. Because the product was technical, the offering materials had to be informative and easy to understand in order to attract buyers inside and outside the industry.
One buyer surfaced early with an attractive offer. Yet, Polaris wanted to test the market to assure itself that a better offer was not available. Mertz quickly contacted other potential buyers. The offering materials allowed prospects to competently assess the opportunity. While other prospects were interested, none were as motivated as the first buyer. Polaris elected to proceed with GRAM Investments. Mertz kept back-up buyers in the wings, which strengthened Polaris's position during the negotiations with GRAM.
Mertz’s value add
Polaris accomplished its objective of selling both the business and building in an all-cash transaction. Mertz's solid base of experience provided the background necessary to navigate through many complex issues and options. Polaris closed in seven months from the time Mertz was retained.